Finance Committee on Dec. 6th, 2007

[The Chair, Conservative, Rob Merrifield]

Thank you very much.

That ends our question and answer portion and this segment of our committee meeting. We want to thank the witnesses for coming forward and presenting your presentations. We have them in written form as well, so we'll take them under due consideration.

I thank the committee for their questions. We will suspend while we bring forward the next panel.

[The Chair, Conservative, Rob Merrifield]

We'll now proceed with the second portion of our meeting. We want to thank our witnesses for being here. I see we have a couple of vacancies, but I think they're coming to the table. As they do, we will proceed.

We'll introduce you and yield you the floor for five minutes. If you can possibly keep it to five minutes, we will certainly appreciate it.

We have Canada's Association for the Fifty-Plus. We have with us William Gleberzon. The floor is yours for five minutes, please, and we thank you for your presentation.

[William Gleberzon, Director, Government Relations, Canada's Association for the Fifty-Plus]

Thank you very much. I appreciate the invitation to make a presentation.

The brief we presented reflected what we'd been asked, and that is what tax reforms we suggest that will benefit the government as well as fifty-plus Canadians. These recommendations will benefit the government by enhancing its income tax and sales tax revenues and benefit the quality of life, independence, and dignity of seniors.

Because I only have five minutes, I'm not going to read what I had intended to read. I'll just read the executive summary. I trust either you've read the brief or will do so, because in it I've set the context, which is very important for understanding why I am making this presentation the way I am. I will just make one comment, and that is that the wave of the future is aging. I think when you take that as your starting point, then you'll understand everything else.

Ottawa should promote the image of retirees as taxpayers rather than just people who are on the receiving end of a pension.

Ottawa should increase all pensions in accordance with the actual CPI increases over the past five years rather than those submitted by StatsCan, which has admitted they've underestimated them.

The current withholding tax or clawback on old age security should be made optional.

The CPP survivor benefit should be reformed so that the total amount received by a couple should continue for the lifetime after the death of one partner. That usually impacts more on women than men who survive their partners. This will also compensate for the fact that splitting a pension, adopted by the government as policy, does not impact single people or per a couple. The benefit should be extended to include blood relatives.

The CPP death benefit should be returned to its pre-1997 level, with increases for inflation since then.

The blending of CPP with corporate and occupational pensions upon retirement should cease and each pension received in its entirety.

CPP disability pensions should be restored to their pre-1997 levels.

People eligible for CPP should be able to apply for it before 65 without having to stop work or reduce their earnings in the month before the month in which they apply. That way you can encourage older workers to continue working.

The retroactivity policy related to CPP should be changed. Currently it's 11 months. It should be for the entire period after the age of 70, retroactive to the age at which the person applies, with interest.

Federally regulated LIFs, locked in funds, and LIRAs should be unlocked 100% at age 65 rather than at age 90, which is the current federal policy. In the meantime, commuted LIFs should be rolled into LRIFs to avoid excessively unfair taxation. While this is a very truncated version of what I have in mind, the way in which people are taxed who commute their corporate or occupational pension into a LIF is totally unfair because all of the cash that's left over after money has been put in the LIF is taxed as if it was one year's income rather than income accumulated over a period of time.

The income tax rate of low-income Canadians should be reduced to 15%--which I'm happy to say has happened--and lower.

Tax credits should be instituted for seniors who provide proof of healthy and active living activities. A recent study has demonstrated that it's lifestyle even more than weight that can help people live longer and healthier lives.

I don't know if you're following me, but the ninth executive summary item I want to amend. I was unable to do it, so I will be sending in an amendment to the committee.

Finally, the federal, provincial, and territorial governments should collaborate in providing subsidies and tax credits for improving insulation and reducing the use of energy in homes.

The other issue I would like to raise is funding. Next spring the government will be reviewing the health accord. Part of that is the national home care program, which we understand is not going to be reviewed, and we urge this committee to urge the government to review it and to extend funding for chronic or continuing care and community care, as well as care for unpaid caregivers, who are the backbone of the health care system.

As I said before, mandatory retirement should be abolished in federally regulated industries and not replaced by mandatory employment.

Thank you very much.

[The Chair, Conservative, Rob Merrifield]

Thank you.

Now we'll hear from Mr. Art Sinclair, director of economic development, from the Greater Kitchener Waterloo Chamber of Commerce.

The floor is yours.

[Art Sinclair, Director, Economic Development, Greater Kitchener Waterloo Chamber of Commerce]

Thank you very much, Mr. Chair and members of the committee, for the invitation to present our pre-budget submission to you this morning.

As the largest accredited chamber of commerce in Ontario, the Greater Kitchener Waterloo Chamber of Commerce serves over 1,900 members, representing all sectors of the local business community. Our membership includes small, medium-sized, and large employers that provide 70,000 jobs in one of Canada’s most progressive and economically diverse regions.

The recommendations we are proposing today reflect the priorities of our membership and are focused on job creation, economic growth, and investment in infrastructure.

Our chamber's mission is to serve the local business sector and to be their advocate on the advancement of our region. We believe the prosperity of our community originates from the productivity of our membership.

Firstly, our chamber commends Minister Flaherty for the proposals outlined in the October 30, 2007, economic statement. The reduction in the general corporate income tax rate to the level recommended by the Canadian Chamber of Commerce will significantly strengthen our ability to attract business and compete effectively. Similarly, the reduction of the lowest marginal personal income tax rate to 15% will initiate work effort, savings, and investment, all critical factors that escalate our national productivity, competitiveness, and prosperity.

Approximately 25% of our local workforce in the Waterloo region is employed in the manufacturing sector, providing Canada's second most manufacturing-intensive economy after Windsor, Ontario. A report issued by Canada's Technology Triangle notes that the value added by manufacturing in the Waterloo region totalled $7.2 billion in 2003. Value added, in this context, is a measure of how much value workers generate using land and capital equipment employed in production, essentially including wages and the return from capital on equipment utilized. This is the measure on which global investment decisions are made.

Despite the relative strength and importance of the Waterloo region manufacturing sector, issues such as competition from abroad and an unstable Canadian dollar are providing significant challenges. In response, our chamber has established our manufacturing action group network, or MAGNet, to advance sector concerns.

This group has developed a series of recommendations that, if implemented, will assist in maintaining jobs and investment in the Waterloo region. Our primary recommendation today to further assist our manufacturers in addition to the corporate tax reductions outlined in the October economic statement is the extension in the 2008 budget of the accelerated capital cost allowance beyond the current two-year timeframe.

As noted by Canadian Manufacturers and Exporters, extending this provision will address the short-term cashflow issues that are challenging manufacturers and exporters across Canada. The extension will allow investment in technologies that are critical for boosting productivity, innovating product lines, and remaining competitive under very challenging global conditions.

The Waterloo region business sector and our partners in economic and social development have been active advocates for investment in the necessary infrastructure to accommodate our growing population and economy. In our brief, we have cited some recent studies that have noted the deteriorating conditions of roads, bridges, and other structures and the urgent requirement for repairs and replacements.

At this time, we support the position advanced by the Federation of Canadian Municipalities that a national plan be developed for eliminating the municipal infrastructure deficit and to prepare the groundwork for protective management of our infrastructure in the future.

The first step in this strategy must be a comprehensive national study to measure the scope and geographic characteristics of the current infrastructure deficit. From a local perspective, we recommend that the federal government provide one-third of the funding costs for the planned rapid transit system in the Waterloo region. In June of this year, the Ontario government committed to funding two-thirds of the project cost, at the same time indicating that the province and our local regional government would collaborate to secure additional funding from the federal government. We are very supportive of receiving the funding so that this project can advance.

Finally, CBC/Radio-Canada has proposed the expansion of local Radio One service, including fully staffed morning and afternoon shows, to the Waterloo region and 11 other communities across Canada. Our chamber supports this plan, as it will provide significant local content related to regional political issues, business development, and cultural initiatives. A report on the expansion will be tabled with the Standing Committee on Canadian Heritage and eventually move forward for full consideration by the House of Commons. We seek the support of all members for this important initiative.

Thank you, and I would be pleased to answer any further questions from the committee.

[The Chair, Conservative, Rob Merrifield]

Thank you very much.

We'll now move on to the Heritage Trust of Nova Scotia. We have Philip Pacey, president.

The floor is yours.

[Philip Pacey, President, Heritage Trust of Nova Scotia]

Thank you, Mr. Chair and members of the Standing Committee on Finance. I appreciate the opportunity to make this presentation. I'd like to welcome the members of the committee to Nova Scotia. I hope you may have the opportunity to explore Halifax while you are here.

If you leave the hotel and turn right, you can walk up Hollis Street. Here you will find many sturdy homes built by early Scottish and Irish settlers of Nova Scotia. Some of these are built of wood and some of stone. Many have five-sided Scottish or oriel dormers, which are characteristic of Halifax. The oldest documented house in Halifax is just about a block and a half up the street on Hollis.

You will also come to the Brewery Market. This complex was built as a brewery, starting in the 1800s. About 30 years ago it was converted into a commercial complex. This is a good example of the rehabilitation of a building for a new use. Here you will find some excellent restaurants where you can have lunch or supper.

As you walk, you may see tourists, even in this weather. Certainly yesterday I saw tourists carrying cameras and taking pictures of our historic buildings. Tourists bring $1.3 billion to the Nova Scotia economy each year. Other than walking and shopping, visiting historic buildings and sites is the biggest activity of tourists in Nova Scotia. Our heritage buildings are major contributors to the economy and to our way of life.

As you walk, you may also see vacant sites. These were once the sites of fine buildings. They are demolition sites. They do not contribute to the economy. This is December, a big month for demolitions. Often demolitions occur in December because the owner of a building is trying to record a loss on paper in order to be able to deduct it from the income for the year and reduce their taxes. One of our recommendations is to remove this deduction.

As you walk, you may see plaques on the faces of the buildings. These plaques have been placed by municipal and provincial governments to recognize the historic and architectural importance of the buildings. The municipal government makes financial commitments to the owners of buildings to assist with repair. I'm pleased to see Bob Harvey, councillor in the Halifax Regional Municipality and member of the heritage advisory committee, here today to indicate that commitment.

If you were to walk down a similar street in New England you would also see federal plaques on the buildings. These plaques state that the owner of the building received funds under a program established by President Ronald Reagan. This program provides a tax credit for the restoration and rehabilitation of heritage buildings. The program has been very successful.

We need a similar program in Canada. We need to see the federal government acknowledge the great importance of heritage buildings as tourist attractions, as economic generators, as contributors to our quality of life, and as an essential part of our legacy to future generations. The owners of the heritage buildings accept substantial restrictions in their use of those buildings. We invite the federal government to join with the owners of heritage buildings in providing financial support to keep those buildings standing.

In our brief, the Heritage Trust has made five recommendations, which I'll just briefly read.

Canada should establish a tax credit for the commercial rehabilitation of heritage buildings.

Canada should establish an individual income tax credit for the repair of heritage buildings.

GST and HST on the cost of qualified repairs to heritage buildings should be rebated.

An owner who demolishes a heritage property should not be allowed to write off its value in order to reduce the taxes payable.

Volunteers should be allowed a deduction for the expenses entailed in their volunteer work.

Please forward these recommendations to the Minister of Finance.

Thank you for your attention.

[The Chair, Conservative, Rob Merrifield]

Thank you very much for your presentation.

We'll now move on to the National Association of Friendship Centres. We have Sean Vanderklis, president, Aboriginal Youth Council.

The floor is yours for five minutes.

[Sean Vanderklis, President, Aboriginal Youth Council, National Association of Friendship Centres]

Thank you, Mr. Chairman.

I'd like to thank the members of the committee for allowing me to make my presentation to them.

As you mentioned, my name is Sean Vanderklis. I'm the president of the National Association of Friendship Centres, Aboriginal Youth Council.

The National Association of Friendship Centres, or NAFC, was established in 1972 and is the national representative body for 117 local friendship centres and seven provincial-territorial associations across Canada.

Friendship centres are aboriginal community centres that offer a wide range of programming in urban off-reserve settings. Programming includes prenatal nutrition, employment and training, youth centres, elder care, day care, cultural programs, and many more. We have friendship centres in every province, with the exception of P.E.I.

The Aboriginal Youth Council, or AYC, is a youth branch of NAFC. We have our own staff and priorities. We represent youth who access friendship centres, and we strive to create opportunities for them to be able to participate in friendship centres and communities.

The AYC has regional representatives from every region in Canada. At our annual youth forum, the membership selects the AYC executive members. The AYC meets quarterly and hosts an annual youth forum in conjunction with the NAFC's AGM.

The NAFC has been very active, but not yet successful, in its lobbying efforts to increase the aboriginal friendship centre program. The aboriginal friendship centre program requires more funding in order to be able to maintain and increase the quality of programming, accountability, and effectiveness of friendship centres and the NAFC.

The NAFC has been working with the Department of Canadian Heritage to outline a four-year investment in order to provide new funding at local, regional, and national levels. In addition, the NAFC will be able to build more capacity in existing centres, open new centres, and take advantage of the best technologies in order to build sustainability.

The AYC recommends that the next federal government budget include increases for the aboriginal friendship centre program.

The friendship centre movement has always shown a commitment to young people, and in 1994 the AYC was established. Since then, youth have had the opportunity to have direct input into the AYC via two youth representatives at the national board and many other initiatives.

According to the most recent census, aboriginal youth under the age of 25 are 50% of the aboriginal population and are the fastest growing segment of the Canadian population. Friendship centres serve a great number of this population; however, they are having difficulties in some areas due to lack of capacity and support for this ever-growing population.

The Aboriginal Youth Council's vision is to create positive change in order to realize the vision, and in order to realize the vision, the aboriginal youth must be active, educated, skilled, and be informed.

Active aboriginal youth participation means effective youth councils that train the young leaders in their communities and regions to provide direction at national levels, to provide support at the regional level for peer aboriginal youth councils—strong regional representation means strong national representation—and to involve 13- to 17-year-olds and introduce them to leadership opportunities.

The AYC recommends that the next federal government budget include funds for youth council development, not just youth programming.

As to the skills aboriginal youth require and the necessary training to be effective, skill training includes development of a “train the trainer” curriculum for aboriginal youth, and implementation of the curriculum at the regional level and local levels.

The AYC recommends that the next federal government budget include training for aboriginal youth.

Educated youth, once engaged, are encouraged to continue their learning when they are both rewarded for attending post-secondary and also recognized for their volunteer achievements.

The AYC recommends that the next federal budget include funds for specific off-reserve student funding and a volunteer recognition initiative.

Informed aboriginal youth have access to information. That information requires staff support to create communication, and hardware and software to be able to create communication materials and disperse them among networks.

The AYC recommends that the next federal budget include support for communication and activities for aboriginal youth.

Aboriginal youth activities require sustained funding that is coordinated by aboriginal youth with assistance from mentors and experienced professionals.

The AYC recommends that the next federal government budget include assisting the AYC in establishing a national aboriginal youth foundation.

The issues facing aboriginal youth in Canada, and more specifically urban aboriginal youth, are complex and multi-generational. To begin addressing them, we'll need to undertake a number of strategic and unified efforts from a wide variety of resources.

The NAFC and AYC are committed to the well-being and development of young leaders in urban settings. The NAFC has a history of excellence in youth engagement, and we continue to practise and promote the fact that the program initiatives that work best for aboriginal youth are those that are developed, delivered, evaluated, and accountable to aboriginal youth. Most important, the initiatives proposed are about facilitating aboriginal youth to have meaningful participation and input in the decisions that affect their lives and provide them with the opportunity to truly show that great leaders start young.

Thank you.

[The Chair, Conservative, Rob Merrifield]

Thank you very much.

We'll now move on the Nova Scotia Association of Social Workers. Executive Director Susan Nasser, the floor is yours.

[Susan Nasser, Executive Director, Nova Scotia Association of Social Workers]

Thank you very much for the opportunity to appear before the standing committee today on your pre-budget consultations.

The Nova Scotia Association of Social Workers is the professional association for 1,600 social workers in the province. We regulate and strengthen the profession and we also have a mandate to pursue social justice. Indeed, our code of ethics calls upon us to engage in social action. Social workers are well positioned to see the devastating impact of poverty on people's lives, and our collective experience as front-line workers has reinforced our resolve to push for changes that would create a more just and equitable society.

The theme of the committee's consultations this year is the tax system the country needs for a prosperous future. It is certainly a daunting focus for those of us who don't consider ourselves too well versed in economics; however, we believe we understand enough to be able to contribute to this discussion.

Certainly we understand the government has a vital role to play, both in mustering resources and, just as important, in providing leadership in building a political will to eradicate poverty so that prosperity is within reach of everybody in Canada.

In our remarks today we'll be focusing on five things. The first is poverty as exclusion. We believe Canada is already a prosperous country. In 2007 Canada recorded a surplus for the ninth consecutive year. In this context we believe there is plenty for everyone, and it's disgraceful that people are being excluded from the good life we all know is possible here.

Let's be clear: poverty isn't just about money; it's about a cycle that denies access to aspects of life that those of us who are well off take for granted, things like good health, a safe and affordable home, and a good education. The resulting inequalities are destructive. As the Canadian Policy Research Networks points out, they erode social cohesion. They lead to worse health and personal security outcomes. They lead to the withdrawal of the haves from the life of the community and the exclusion of the have-nots, and generally, inequality diminishes the richness and flourishing of a society.

To accomplish our vision of a prosperous future for all Canadians, it is essential to direct our efforts toward eliminating these inequalities so that everyone has an opportunity to fulfill their dreams.

Second is what it means to be poor. In Canada we also envision a need to recognize our collective responsibilities and to treat each other with respect. In this regard, we must be vigilant about the exclusionary impact of callous, negative, and dismissive attitudes toward people living in poverty. The Fraser Institute states in one of its reports that poverty means that people cannot afford all the basic necessities of life and must go to extraordinary lengths or do without. The extraordinary lengths they then go on to mention include borrowing or getting assistance from family and friends. Actually, it is important to understand that the extraordinary lengths people go to when they're living in poverty include using food banks, choosing between heating and eating, not taking medications because they're too expensive, living in substandard housing, eating poorly or not at all, and becoming homeless.

Another example of a negative innuendo about poverty can be found in some of the arguments in support of a flat tax because of the enormous positive incentives for hard work, savings, and investment. This notion implies that if you are poor it is because you do not work hard enough. In fact, living in poverty is really hard work, and this kind of negative stereotype is symptomatic of the unforgiving societal attitudes poor people have to endure along with their material hardship.

Third is what taxes are for. What has all this got to do with the tax system, you might ask. Essentially, we think the tax system provides a way to pay for public goods and services, including those that will alleviate poverty. This includes a whole range of things from public schools, universities, health care, libraries, safe communities, and the list goes on and on. Many of us think taxes are onerous. We celebrate tax freedom day with a mixture of resignation and glee, and yet we don't complain about the public services available to us as citizens of Canada, or if we complain, it's because we want to have more and better services.

An American author critical of the whole idea of tax freedom day commented that we have no moral claim to our pre-tax income, as that very income is made possible not simply by our personal efforts but by our participation in a broader system of social cooperation, the economy, which itself is made possible in part by taxes and the public actions they facilitate.

Fourth is how the tax system does not address poverty. The tax system provides ways for taxpayers to save--RESPs and RRSPs, for example. This is another area where poverty is exclusive, since those struggling to survive on low incomes cannot take advantage of these mechanisms. Other aspects of the tax system that disadvantage the poor include disincentives for saving and other forms of asset accumulation, retirement savings that render people ineligible for social programs, and tax credits that low-income earners cannot access. The Organisation for Economic Co-operation and Development highlights the benefits of structuring programs that allow poor people to accumulate assets, thus addressing what another author has dubbed the double standard in public policy: providing large asset subsidies for the wealthy but discouraging asset accumulation by the poor.

Finally, our recommendations.

The first one is to make poverty reduction an interim step and, ultimately, the elimination of poverty as a top priority for the federal government.

The second one is to understand poverty in its broadest sense of exclusion from the prosperity experienced by most Canadians. Devise poverty reduction and poverty elimination strategies that create an inclusive society.

The third one is to recognize that taxes have a purpose: the creation of financial resources that make inclusiveness and prosperity possible, and clearly articulate this purpose so that taxes are not just considered to be a burden.

The fourth one is to maintain a progressive income tax and do not institute a flat tax.

The fifth one is not to cut taxes unless this can be done without cutbacks to the social programs that were funded through tax revenues.

The sixth one is to revise tax structures that advantage wealthy people and disadvantage low-income people. Possible revisions would be refundable tax credits that are not clawed back, tax pre-paid savings plans, and social investments that make it possible for low-income people to accumulate savings.

We believe that collectively, as Canadians, we can all work to bring about a prosperous future, which we think was one of your goals in your pre-budget hearings this year.

Thank you.

[The Chair, Conservative, Rob Merrifield]

Thank you for your presentation.

Now we'll move on to our last presenter. We have the Union of Environment Workers, Mark Power, regional vice-president, Newfoundland and Labrador region.

The floor is yours for five minutes.

[Mark Power, Regional Vice-President, Newfoundland and Labrador Region, Union of Environment Workers]

Thank you, Mr. Chair.

Good morning, everybody.

By way of a further introduction, the Union of Environment Workers is a component union of PSAC, the Public Service Alliance of Canada.

By way of opening remarks, I'm going to read from an earlier touchstone document of ours that should complement our submission that's already been sent in.

Canada's fisheries and oceans sector makes a number of important contributions to Canadian life. It represents an important economic engine, employing hundreds and thousands of Canadians and injecting billions of dollars into the national economy. Fisheries and fish stocks are a significant part of our culture of national heritage. They continue to be the backbone of sustainable communities throughout the country. The marine biological abundance of British Columbia--9,600 salmon stocks--sustained some of North America's most complex aboriginal societies for thousands of years.

Fisheries and Oceans Canada plays a number of crucial roles in Canada's fisheries and oceans: rebuilding, conserving, and managing our fisheries resources and habitats on a sustainable level, building on our scientific understanding of oceans and waterways, but also sustaining the hundreds of coastal communities where fishing is the only available source of employment, where only a very few economic alternatives exist.

Fishery resources are a common public asset belonging to all Canadians. Public opinion polls consistently show that the great majority of Canadians care about how the fishery is managed. There is a great deal of pressure from large corporations to privatize the fisheries. Taxpayers, in particular, should be wary of the claims of proponents of privatized fisheries. In the end, it is the taxpayer who foots the bill when coastal communities lose access to the fishery and economic benefits from the resource. The closure of the east coast cod fishery, for example, cost $3 billion initially in payments, and tax revenue and income losses continue.

Of the world's 200 major fisheries, two-thirds are in decline and threatened. In Canada we only have to look at the east coast cod fishery to see the disastrous situation facing Canada's fisheries. Fisheries across the countries are in steep decline, including salmon, herring, halibut, scallops, shrimp, and crab stocks, which are threatened. Tragically, Fisheries and Oceans Canada's ability to perform its mandate has been diminished and compromised over the years.

There is a growing concern among DFO employees about the inability to meet their legal requirements under the Fisheries Act and other attendant legislation, such as the recently enacted SARA, Species at Risk Act. The government's capacity to conserve and scientifically manage the salmon resource continues to be eroded by inadequate funding, according to the report of the Pacific Fisheries Conservation Resource Council. The 2005 report from the Senate Standing Committee on Fisheries and Oceans stated as their number one recommendation that “The Government of Canada provide the Department of Fisheries and Oceans with adequate funding in order to fulfill its Fisheries mandate.”

It's not too late to save our fisheries. With sound management based on good science, with conservation as the priority, we can restore our fish stocks to healthy sustainable levels. The fish stocks of Canada belong to all Canadians. They are a public resource and require deft management by a skilled and dedicated public service. To achieve this goal for the benefit of all Canadians, we need to pressure the government to reinvest tax dollars in the department's budget.

Thank you.

[The Chair, Conservative, Rob Merrifield]

Thank you very much.

We'll now move to the question and answer portion of our meeting.

We'll start with Mr. Savage.

The floor is yours. We'll have a first round of seven minutes and then we'll go to a five-minute round, and I think that'll fit everybody in.

[Michael Savage, Liberal, Dartmouth—Cole Harbour, NS]

Thank you, Chair, and welcome to the witnesses today, the panellists who have come here to talk to us.

Mr. Sinclair, rather than a question, I have a comment. It may seem odd to have a member from Kitchener-Waterloo here in Halifax, but welcome. It's great to have you here. I want to tell you that we're going to be helping your community in January. The Liberal caucus is having our national winter caucus in Kitchener-Waterloo. I don't know if you know that, but it has something to do with the fact that our whip is from Kitchener, I suspect.

[Art Sinclair]

That might have some relationship to it. We look forward to seeing your caucus members.

[Michael Savage, Liberal, Dartmouth—Cole Harbour, NS]

I look forward to being there.

Mr. Pacey, thank you for your presentation. You pointed out quite well, for those who may not be from Halifax, some of the important heritage that we do preserve here, and, frankly, some that we don't very well. I would add--and you understand why I would add this--that if you walked down Water Street to the Dartmouth ferry and you took the boat across, you would find some very significant heritage on the Dartmouth side--Quaker House, the Starr manufacturing property, the Shubenacadie Canal.

I remember growing up in Dartmouth, and my father used to drop us off--seven kids--at the Dartmouth Museum quite often when he would come over to Halifax to deliver a baby or something like that. We spent a lot of time in that museum. It's a shame, frankly, that right now most of the artifacts from the Dartmouth Museum are in a warehouse in Burnside because we don't have an appropriate place to put them. We have Evergreen House. So we simply don't invest enough in heritage in Canada, I would suggest, and certainly here, I don't think. We have some good examples of what you can do when you preserve heritage.

I'm interested in your recommendations. I'm wondering if you have any kind of idea of the costing of them. Have you been able to put any sort of financial numbers to what any of these recommendations would cost?

[Philip Pacey]

No, I haven't. There would be limits on the costs, because if you look at the details of the recommendation, the benefits would be limited to those buildings that are on the national register of historic properties. Basically, any building that has been recognized by a municipal or provincial government in the country is eligible for inclusion in that registry. I'm not sure how many buildings there are, but it would probably be in the tens of thousands. So if one were looking at maybe 1% or 2% of those buildings applying in any given year, then one might be looking at a few hundred applications. If one were looking at, say, $100,000 as a typical amount, then one might be looking at maybe $10 million or $20 million a year, or something in that frame.

There was a program that existed until about a year and a half ago, the so-called CHPIF program, which enabled commercial heritage property owners to apply for assistance. I think it was budgeted at about $25 million or $30 million, and that money was spent in a couple of years.

[Michael Savage, Liberal, Dartmouth—Cole Harbour, NS]

Thank you very much.

Ms. Nasser, it's nice to see you again at our parliamentary hearing.

I want to raise an issue you spoke about, and that is flat tax versus progressive tax. One of the things we hear a lot from government members is that the GST reduction really helps those who need it, because they don't pay income tax in some cases, but they do pay GST. In your brief, you talk about the HST as a flat tax, and the fact that, if I'm understanding your argument, it is not a very good way to go about reducing the burden on the poorest people. The two percentage points dropped in the GST that we have seen so far takes something in the order of $12 billion out of the economy. Is there any better way this money could be spent to help those who need help the most?

[Susan Nasser]

I think, rather than mentioning all the specific ideas that people come up with for reducing poverty--and there are many--we would join those who are asking for a national strategy and provincial strategies for reducing poverty. Certainly, we hear all the time that we need more housing, and we need higher social assistance rates, which I realize is under provincial jurisdiction. There are supports for education, and we've heard about child care. Those are all things that money could be spent on to help alleviate poverty.

[Michael Savage, Liberal, Dartmouth—Cole Harbour, NS]

If you were making a list of things to help alleviate poverty, where would reducing the GST fall on that list?

[Susan Nasser]

Do you mean in terms of people paying it, or what you do with the revenues from it?

[Michael Savage, Liberal, Dartmouth—Cole Harbour, NS]

We're talking largely about reducing the incidence of poverty--that's what your brief is about. There are government members who honestly believe that reducing the GST is a very good thing for those most in need, because they may not pay income tax but they buy stuff.

As you point out, they pay the same for a passport as somebody who makes $200,000 a year. So it is a regressive tax in every sense.

I'm just trying to point out that it's my belief--and I want to see if you concur with this--that reducing the GST is not a very effective way of assisting those who are most in need.

[Susan Nasser]

I think that's correct, because when you purchase anything on which the GST is charged, you pay the amount, whatever it is. It gets reduced a little, and that's a small help, but across the board it's much more difficult for people living in poverty. The tax they pay is a much greater percentage of what they actually have to spend than when you make a better income.

I think reducing the GST is certainly helpful. Anything that makes things cost less is useful, but in the grand scheme of things it's not going to make a huge difference. It certainly doesn't substitute for a strategy to reduce poverty by bringing all these large trends together.

[The Chair, Conservative, Rob Merrifield]

Thank you very much.

Monsieur St-Cyr.